Target: ₹1,535

CMP: ₹1,188.95

Affle’s (India) Q4FY24 revenue stood at ₹506.20 crore up, 1.5 per cent q-o-q/42.3 per cent y-o-y, beating our estimates of ₹499.8 crore, driven by steady growth in CPCU revenue. EBITDA margin was flat at 19.4 per cent, on q-o-q and y-o-y basis, slightly beating our estimate of 19.2 per cent.

CPCU revenue recorded steady growth at ₹503.8 crore, up 5.5 per cent q-o-q/57.8 per cent y-o-y. Converted users grew 5.5 per cent q-o-q/41.7 per cent y-o-y to ₹8.8 crore. The company is poised to further accelerate its growth trajectory in FY2025 with a gradual increase in profitability margin.

The company is experiencing a strong market opportunity as advertisers are consistently increasing their digital spending.

We maintain Buyt on Affle with an unchanged PT of ₹1,535, as the company is expected to accelerate the growth trajectory, driven by a wider adoption of its CPCU model and increased digital spending by advertisers.

Key Risks: Entry of a large technology player in this space; inability to generate relevant data for targeted advertisers; and government regulations related to the management of consumer data and respect for privacy.